Coverage spread: 2 sources — 2 unrated
Lean ratings via AllSides / Media Bias-Fact-Check. How this works.
Where they agree
- Salad and Go filed for Chapter 11 bankruptcy on Aug. 4 and closed its remaining stores immediately after.
- Dutch Bros originally had a deal to acquire 65 former Salad and Go sites for $105 million.
- 7 Brew contested that sale, forcing an auction, and won with a bid of over $143 million for 73 locations.
- Dutch Bros declined to raise its bid and will receive a $3.8 million termination fee if the new deal closes.
Where they differ
- Phoenix New Times provides much more detail on the bankruptcy backstory, including the 16 potential buyers considered and the Aug. 7 hearing where 7 Brew pushed for an auction.
- Phoenix New Times includes Dutch Bros CEO Christine Barone’s direct quote explaining the company’s disciplined capital approach, which ABC15 omits.
- ABC15’s account is a brief summary pointing to a Business Journal story, while Phoenix New Times offers original reporting with landlord objections and sale-approval timeline details.
- Phoenix New Times notes 7 Brew’s limited existing Arizona presence (just three stands) and the Sept. 21 court approval hearing, details absent from ABC15’s shorter piece.
7 Brew, an Arkansas-based drive-thru coffee chain, won a bankruptcy auction for dozens of former Salad and Go locations, agreeing to pay more than $143 million for 73 sites after outbidding Tempe-based Dutch Bros, which had an earlier deal worth $105 million for 65 sites. A bankruptcy judge still needs to approve the new agreement at a hearing scheduled for Sept. 21.
How did this bidding war start?
Salad and Go, the Gilbert-founded fast-casual chain, filed for Chapter 11 bankruptcy protection on Aug. 4 and shut its remaining Arizona and Nevada stores the very next day. The chain had expanded aggressively into Texas and Oklahoma after a private equity firm bought it in 2021, and it estimated it had roughly 130 locations in its portfolio at the time of filing.
As part of the bankruptcy process, Salad and Go’s board reviewed 16 potential buyers for its real estate and leases and settled on Dutch Bros, the Tempe-based coffee chain, as the best fit. Dutch Bros (parent company Boersma Bros.) offered $105 million for 65 locations across four states, including more than 40 in the Phoenix metro area, and put down a $10 million deposit to back the deal.
Why did the deal change?
7 Brew, a newer and fast-growing drive-thru coffee chain, objected to letting the Dutch Bros deal go through without competition. At an Aug. 7 court hearing, 7 Brew’s attorneys pushed the judge to order a formal auction instead. Salad and Go and the court agreed, and an auction was held in which the two coffee chains bid against each other for the shuttered sites.
7 Brew’s winning bid came in at $143.18 million for 73 locations — more than 20% higher, for eight more stores than the original Dutch Bros offer. Dutch Bros chose not to raise its bid at the auction. Of the 73 sites 7 Brew is set to take over, 35 are in the Phoenix area and six are in Tucson.
What happens to Dutch Bros now?
Dutch Bros is not walking away empty-handed. Under the terms of the process, it remains a backup bidder for the locations it originally identified and stands to collect a $3.8 million termination fee plus other expenses if the 7 Brew deal is finalized. Dutch Bros CEO and President Christine Barone said the company has “always been disciplined” in its capital allocation and that, while it chose not to raise its offer, it “remains engaged in the process” and will keep evaluating deals that offer the right return. The company still plans to nearly double its number of locations by 2029.
What’s next for the vacant Salad and Go stores?
The sale to 7 Brew is not yet final. A bankruptcy judge is set to consider approval at a hearing on Sept. 21. Some landlords of the vacant properties have objected to the takeover because their shopping centers already have coffee shops as tenants; those landlords have until Sept. 17 to file formal objections to 7 Brew assuming the leases. The roughly 55-plus remaining Salad and Go locations not covered by this deal may be sold off separately, in smaller groups or individually.
Who is 7 Brew?
Founded in 2017, 7 Brew is known for its customizable coffee menu and fast-moving “Brew Crew” service model. It arrived in Arizona only last year and currently operates just three stands in the state — one in Queen Creek and two in Tucson — meaning this deal would represent a dramatic expansion of its footprint in the market almost overnight.
Sources
Featured photo: The Bushranger via Wikimedia Commons (CC BY-SA 4.0)